Where Are the Truck Parts?

It’s no secret, and every one of the subject-matter experts we reached out to agreed: maintenance costs increased in 2022 for vocational work truck fleets.

Several factors impacted this increase, from the lingering effects of the COVID-19 pandemic to rising inflation.

“Due to high demand and parts and staff shortages, maintenance costs have increased roughly 20-30% since last year. Vehicles are on the road longer, the supply chain and OEMs are still unable to produce the parts and equipment fleets need, and there’s a shortage of qualified technicians available to do the work,” said Amein Punjani, COO of Amerit.

You can’t ignore that 2022 saw 8-10% inflation.

“This inflation was felt in maintenance costs: with oil and labor costs increasing materially, fuel surcharges, part shortages increasing prices, and more expensive options of sourcing far away parts plus shipping overnight,” said Scot Wingo, CEO and co-founder of Spiffy.

And fleets are feeling the impact.

“Between the parts and labor shortages and rising inflation rates, the average maintenance cost has soared. Publicly traded entities, such as Covenant Logistics Group, have disclosed increased maintenance costs in the millions year-over-year,” said Norm Thomas, fleet business consultant at Uptake.

Vehicle mileage has been increasing since the pandemic, impacting related maintenance costs.

“In addition, many fleets have extended the service lives of their vehicles, mainly because they were unable to locate replacements due to shortages experienced in 2021 and early 2022,” said Shay Misra, product marketer at Fleetio.

This upward trend may show signs of continuing.

“I anticipate per-item maintenance costs to rise in the coming years. Inflation and a continuing shortage of technicians are pushing up costs for labor and parts,” said Brett Klynn, director of fleet division & strategic business development at Wrench.

A report released during TMC’s 2022 Annual Meeting & Transportation Technology Exhibition revealed that the average cost of parts and labor for vehicle repairs increased by 3.7% in Q4 of 2021 due to rising labor costs.

Misra noted that the TMC report also reveals where fleets spent most on maintenance and repairs in Q4 2021 based on VMRS System Level Coding.

“According to the VMRS System Level Coding, 36.8% of power plant expenses were spent, and 14.9% of exhaust systems were needed. Brakes accounted for 5% of all expenditures, making up the third-largest category. Longer vehicle life may be required due to higher brake costs, which reflect additional mileage. Since fleets have been waiting for new and replacement vehicles to become available in pre-pandemic amounts, extended trade cycles have become the norm,” Misra added.

Where are the Parts?

Parts shortages have impacted all fleets in all vocations for the past two years.

“All parts were in short supply, including oil and gas, air filters, sensors, alternators, and batteries. OEMs were using the stock they had to build new vehicles, which led to shortages of replacement parts and longer wait times at the dealers for repairs,” said Thomas of Uptake.

What was even more difficult was the need for more consistency.  

“In 2022, we experienced what I would coin ‘rolling supply chain issues’ specifically around various auto parts. One month it would be imported oil filters, then that would resolve, and it would be brake pads for imports. Next, it would be parts for Ram Promaster vans, then we were on to domestic oil filters, etc.,” said Wingo of Spiffy.

One clear thing in talking with the experts is that some suppliers handle shortages better than others. 

“We have noticed delays on later model parts, which must come from OEM sources. It is tough to point out specific parts, as some are unique to year make and models,” said Buddy Crowley, vice president of operations at Wrench.

Klynn of Wrench agreed, noting that while they have seen some delays on parts, it has been chiefly with OEMs.

“The aftermarket suppliers represent most of our business and are less affected by shortages. At times, catalytic converters and diesel particulate filters (DPFs) are bogged down due to the sheer volume of theft going on right now,” Klynn said.

And you can’t talk about parts shortages without covering semiconductor chips.

“The automotive industry feels the effects of a global shortage of Semiconductor chips. Automobiles cannot be fully assembled, and many dealerships have had difficulty keeping up with customer demand. This has led to a shortfall in sales and earnings for automakers, as well as parts shortages that have impacted thousands of vehicles on dealer lots around the world,” said Misra of Fleetio.

Misra also noted that automobile companies and dealerships were having difficulty keeping up with customer demand because of a shortage of semiconductor chips and reported shortages of plastic and foam material made from petroleum (due in part to higher oil prices).

“Semiconductor chips are one component of automobiles that are particularly susceptible to shortages due to their high demand and critical function. The problem began in 2020 when companies producing these components went through an economic crisis due to the pandemic, which caused production stoppages. During the pandemic, there was an increased demand for vehicles due to the growth of logistics companies. Consequently, demand for chips spiked amidst a supply shortfall,” Misra said.

 Manufactured vehicles are mostly left to sit, waiting for the missing parts.

“A parts shortage had automakers leave thousands of their most-profitable vehicles sitting on lots waiting to be fully assembled. The global shortage of semiconductor chips has hobbled automakers' ability to assemble vehicles and meet high buyer demand fully,” Misra added.

Looking back, before COVID-19, it wasn’t uncommon for OEMs, suppliers, and fleets to have spare parts on hand to distribute wherever vehicles were in need.

“The working system, which built excess in our industry, was eliminated by the pandemic. Today, the supply chain and OEMs are still not operating at levels seen before the pandemic. We’re still facing issues getting equipment like air compressors, radiators, catalytic converts, and more. Stocking our mobile service centers requires tools and equipment that have been difficult to come by. We see the most impact in our heavy-duty repairs, followed closely by medium-duty repairs,” said Dan Williams, CEO of Amerit.

When Will Work Truck Fleets Get Parts?

First, the good news:

“We see improvement already. It’s not as bad as it was, but it will still take time to create the abundance we had before COVID-19. As OEMs and suppliers continue to increase purchase orders and increase manufacturing, supply chains have started to recover. We’re doing a better job of working together as an industry to build up materials and recover from the shortages that have severely impacted fleets across the country,” said Williams of Amerit.

Wingo agreed that he still sees issues but noted that Spiffy tracks the macroeconomic trends and watches the costs of containers, sea transport, and port backlogs.

“All the macro data indicates we should see improvements, but we haven’t seen it on the ground yet. As I was writing my response, we experienced a country-wide stock out of a specific domestic filter we frequently need,” Wingo added.

So, it’s clear things are getting better, but that doesn’t mean it’s back to normal.

“These trends will continue into 2023 and potentially into early 2024, which makes understanding market conditions, vehicle repair requirements, and where to invest in training and tools even more important. President Biden signed the CHIPS and Science Act (H.R.4346) on Aug. 9, 2022, to strengthen the U.S. semiconductor supply chain and promote research and development of advanced technologies. However, it will take some time for supply chain issues to alleviate, as training and building the infrastructure will likely take time to deploy,” said Misra of Fleetio.

This means fleets need to continue to be thoughtful about their purchases, and we will continue to see some extended vehicle lifecycles.

“Shortages will continue into 2023, compounding with tighter budgets due to inflation and recession concerns. As a result, fleet managers and technicians will be pushed to extend their fleet’s current lifecycle,” said Thomas of Uptake.

Tips to Deal with Truck Parts Shortages

So, with ongoing parts shortages and concerns, what can fleet managers do to mitigate the issues and keep their fleet vehicles rolling safely? Check out these seven tips!

1. Personalize Your Maintenance Strategy

“Personalize your maintenance strategy to your fleet by investing in your work order data. Many fleets are compiling this data and not using it to gather meaningful insights. Instead, invest in analyzing and dissecting the data for actionable takeaways. If your work order data tells you that several trucks have historically required a new part sooner than the OEM suggests, it’s time to implement a new, proactive strategy. This will extend the lifecycle of your vehicles, prevent you from pulling a truck as it waits for a part, and prevent catastrophic failures,” said Thomas of Uptake.

2. Stay Up on PMs

“Stay on schedule with all preventive maintenance; it is the best advice we can give to any of our customers,” said Crowley of Wrench.

3. Don’t Ignore Small Repairs

“There will always be repairs that are inconvenient and seem unimportant, but certain repairs can prevent breakdowns and eliminate the need for emergency parts to be brought in at greater costs. During vehicle shortages, keeping assets running longer is tempting. Still, preventive maintenance will always be key to keeping trucks in safe working order,” said Williams of Amerit.

4. Plan Ahead

“Plan ahead. Don’t wait for things to become a crisis before addressing them. If you have a vehicle in need of service, schedule it. Be aware that many online parts companies will show items in stock that are not. Don’t assume that just because a google-search shows a part, it is available,” said Klynn of Wrench.

5. Know What Parts are Available — and What’s Not!

“Try and understand what components and parts in the supply chain are restricted. Then, try and modify your vehicle use patterns to favor wearing out parts that are not supply-chain restricted for parts that are. For example, it might be better to wear out your battery than your spark plug, even though it is much cheaper and easier to repair. The parts shortages can cause interruption, so fleets need to be mindful of the specific parts that are key to their fleet operations. Fleet managers and owners should leverage software solutions like Fleetio that provide granular-level insights into usage and maintenance data. Having access to this data and knowing how to use it will help forecast needs accurately for fleets and prepare them for better planning,” said Misra of Fleetio.

6. Get Creative & Set Inventory

“In times of shortage or need, it’s critical that you take a hard look at your stock and inventory levels and make sure you’re set right. Don’t be afraid to come up with new solutions and think outside the box. For example, don’t be afraid to research smaller providers, or local OEMs or suppliers,” said Williams of Amerit.

7. Get Ahead

“Some shortages are localized; in 2022, we built a centralized warehouse that stocked our most frequently used parts. Therefore, if there was a local ‘stock out,’ we could be a backstop or plan B. It’s not optimal, but it’s better than the alternative of being unable to repair or perform a PM,” said Wingo of Spiffy. “Also, instead of just-in-time ordering, order parts before you need them. Most vendors have generous return policies, so there is no downside.”